Momentum building for Kalamazoo's Edison neighborhood after redevelopment stalls for years

Kalamazoo Gazette File PhotoA community credit union has filed a federal charter application and hopes to move into the site where an adult bookstore had been located in the Edison neighborhood's Washington Square area.

KALAMAZOO — After years of inactivity, the
long-promised but undelivered revitalization of Kalamazoo’s Washington
Square district
appears to be gaining momentum.

The removal six years ago of an adult bookstore and a nude dance club on Portage Street in the city’s Edison neighborhood
was hailed as a catalyst for urban renewal.

But the area, the commercial core of Kalamazoo’s largest neighborhood, has languished.

The one-acre lot where a Deja Vu strip club sat remains vacant. But other recent developments promise new hope for the area:

“Right now, in Edison, this is like a
‘wow’ moment,” said Tammy Taylor, executive director of the Edison
Neighborhood Association.
“It’s a really exciting time.”

Sluggish economy

Bing mapsThe Marketplace site is the large clearing in the center of this aerial picture. The Bank Street Farmer's Market is in the upper left corner of the picture.

Promised redevelopment activity in the Washington Square district has been idle for years.

“We thought once the adult venues moved out of the neighborhood, we thought the redevelopment would be instantaneous,” Taylor
said. “But the economy took a dive.”

Adding to difficulties, a plan by a
private developer from California to build 31 homes about a block away
fell through in
2006. The city already had spent about $600,000 in federal block
grant money to build sidewalks, install water and sewer service
and add street lights for the project.

The Marketplace development, at the corner of Bank and Collins streets and east of the Bank Street Farmer’s Market, would
have brought the first newly built homes in the Edison neighborhood since about 1970, Taylor said.

“We were quite concerned that it (the seven-acre Marketplace land) might sit vacant for a long time,” Taylor said.

But thanks to federal stimulus dollars, the project has new life.

Project before commission

The city of Kalamazoo, the Kalamazoo County Land Bank and the Home Builders Association of Greater Kalamazoo are preparing
torelaunch the housing project using about $4.1 million in funding from the federal Neighborhood Stabilization Program.

The City Commission Monday will meet to hear more details about the project, which is being called Marketplace at Washington
Square, and will be asked to approve the development.

“Some may see a neighborhood in decline,”
Laura Lam, deputy director of the city’s Community Planning and
Development Department,
said of the Edison neighborhood. “But we see a transformative
project. ... We think that it will have a ripple effect on the
neighborhood and bring property values up.”

The Kalamazoo County Land Bank acquired the seven-acre vacant plot in August for $480,000. Originally planned as 31 individual
home sites, the development will be divided into 24 parcels, which will accommodate bigger houses.

The homes, which are to be between 1,700
and 1,800 square feet in size with three bedrooms and two-and-a-half
bathrooms, would
cost about $200,000 each to build. They will be marketed to low-
to moderate-income families. They must be sold for a “fair-market
appraisal” price.

It’s difficult to predict an appraisal price for the homes before they’re constructed, Lam said. But one estimate is $85,000,
according to city documents.

To be able to purchase a home, a family’s
income must be less than 120 percent of the area median income, which
for Kalamazoo
ranges from $51,240 for a single person to $73,200 for a family of
four. The purchaser also must qualify for a mortgage from
a bank or credit union.

There are additional incentives to purchase one of the homes, including a down-payment program in which federal funds would
be loaned to the buyer to cover a 20 percent down payment, but would be forgivable over 10 years, Lam said.

The development also was designated a Neighborhood Enterprise Zone in 2008, which gives homeowners significant property tax
breaks, estimated at about $2,000 a year off their bills.

So while there’s uncertainty about whether
there will be demand for new houses in the Edison neighborhood, Lam
said the incentives,
combined with the deal on the housing price, should make them
attractive to buyers.

“The hope is we would be very aggressive in sales and get all the houses locked in,” she said.

Association to oversee development

If the project is approved by the City Commission Monday, the goal is to have the first four homes completed by June, in time
for the Home Builder Association’s annual Parade of Homes tour.

The first 18 homes in the development
would be built using the $4.1 million in stimulus funding. The remaining
six homes would be built with money from the sales of the first 18, Lam
said.
Any remaining money after all the homes are sold would go back
into the Land Bank’s programs to renovate older homes and raze
condemned homes.

The association would be the developer on the project and would choose general contractors to construct the homes. It would
collect a $480,000 fee, but part of that money is tied to the successful sale of all the homes.

“It really is a great opportunity to revitalize the Edison neighborhood and prevent the decaying of housing prices,” said
Dale Shugars, executive vice president of the Home Builders Association.

City and federal officials would have oversight of payment to contractors, Lam said.

Other projects taking shape

In addition to the Marketplace at Washington Square project, other developments in the area are giving Edison neighborhood
officials reason to believe the promised revitalization is beginning to take hold.

The Community Promise Federal Credit Union
hopes to open by late summer in the former adult bookstore building on
Portage
Street. The Community Development Credit Union would focus on
serving low-income residents who typically haven’t had access
to traditional banks and credit unions.

Kalamazoo Loaves and Fishes, a local food bank, is raising money to build a $2.5 million, 20,000-square-foot facility a few
blocks north on Portage Street.

And Roger Schmidt’s three-story building
across Portage Street from the former Deja Vu site is leasing newly
renovated apartments.